Level of income tax in Geneva canton

I’d like to have your views regarding the level of income tax in canton of Geneva especially for single people, a topic that does not seem to impact so much Geneva in terms of reputation despite its high-level income taxation (around 25-30% higher than canton of Zurich).

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Geneva tax authorities rejected my request to deduct a portion of my rent because of home office arguing that teleworking due to Covid19 is not durable…

Same here. Although it was clearly stated in the tax guidance how to deduct for teleworking, I was very surprised by their rejection. I did not challenge it further though. Not sure if anyone managed to convince them?

I was not surprised because this cost deduction would have had too much impacted on tax revenues. Therefore, they issued this guidance in March by opportunity to avoid an adverse effect on the level of income tax collected. They even issued another guidance to inform that deductions for meal and transportation would not be considered for teleworkers, which in a way makes sense but all in all result in higher income tax collected! But most importantly, I would emphasize the huge gap in terms of income tax burden between french speaking cantons and others: for a single person, the difference of annual income tax between Geneva and Zurich is around 25-30% ! Because Geneva spends too much and for no additional value on tax payers… The level of income tax in Geneva is more or less similar with France…and not many people know that.

Geneva is nice for tax-exempted international organisations and their staff, but a nightmare for everyone else. For me, even taxes in Zurich are way too high. The French-speaking cantons seem to vote more left leaning what comes with a cost for tax payers (very generous social systems, redistribution of wealth, etc. that all costs money). People get what they vote for.

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Ouch. Do you have a dedicated room not used for any other purposes and did you state that and did you provide a copy of your rental contract? As I understood from the circular they sent out that was the condition.

If they didn’t allow that, did they allow deductions for meals at work and travel costs?

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Yes I had a separate room and attached also the rent contract. In their explanation back, they told it was basically not “sustained” way of working, they do not accept the home working only for “covid purposes” but it should have been a sustained change of ways of working. Makes no sense but I felt like they will only accept for workers without offices.

Anyway, they added back the transport and meals at work instead. So, still slightly worse off, but if they do not accept there is not much I can do, and at least they treat you fair by adding back the meals.

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They reproduced the same statement that home office because of Covid19 is not sustainable and cannot be accepted (I provided the rent contract also). They only allowed the CHF 1,697 deductions for professional costs. I can hardly claim travel/meals costs since I only went to the office for 2 months and half in 2020.

Anyone can use this tax calculator to realize the huge gap between cantons, including Geneva vs Zurich:

That’s bad news. Below is the circular published on their website and reading it again I realise they aren’t going to allow any deductions for C19 home office.

The example they gave me before the pandemic of when they would allow a deduction for home office was if you are sewing or knitting using a room in your house and your employer doesn’t provide you another place to work.

In my case I work outside the canton and have to sleep over as >8 hours return journey. The only way it works with the family is wfh a couple of days per week, I have a dedicated, permanent office at home and they don’t allow me to deduct the cost. I should really move to another canton…

" J’ai dû télétravailler durant la période de la pandémie de COVID-19, que puis-je déduire?

Sous l’angle fiscal, le télétravail se définit comme l’occupation durable d’une pièce uniquement dédiée à l’activité professionnelle lorsqu’aucune place de travail n’est mise à disposition par l’employeur pour l’exercice de l’activité de son employé.

Dans le contexte spécifique du COVID-19, le télétravail rendu nécessaire en raison de la pandémie n’est pas considéré comme une activité durable. "

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If you decide to move to another canton, I would strongly recommend you ensure all requirements are met to transfer your fiscal residence, because Geneva tax authorities do not easily let generous tax payers move to another canton and they will do their best to consider that your fiscal residence remains in Geneva…their leeway to interpret the important concept of fiscal residence in their favor is important…

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My kids go to school so changing canton would involve uprooting them and starting a new social life elswehere. So they have me trapped just like the UDCs famous milking cow!

Life is good, but sometimes it feels we are progressively adding disincentives for me to continue what I am doing. My alternative is to claim chômage (which I don’t like) / retire early / move, in any of these scenarios I am no longer a net contributor to GE taxes

Income taxes are eye wateringly high in Geneva (despite the outward perception of Switzerland being light touch on taxes), but if your company has some sort of scheme to pay you in shares and there is a lot of capital growth, it can work out well as there is 0% CGT. Everyone’s situation is different and it will depend on the structure of your pay package, but I was definitely a lot better off in the aggregate with a cost of living increase and 0% CGT compared to living in London. Most of my colleagues felt similarly.

I believe CGT for non professional investors is the same through CH = 0. Geneva did have a favourable treatment of stock options versus some other Romand cantons on the past, not sure that it is still the case though

Just checked and my bonus is taxed at ~46% in Geneva vs ~29% in Zug. (marginal ICC+IFD+Social deductions).

And would save like CHF15k on base income taxes and have cheaper rent + more modern housing… Is Zug the promised land?

I think Geneva does have higher childcare contributions but being a single earner with no kids seems to be pricey here.

Well for a single earner like myself Vaud is not far off either. And let’s not forget about the impact of wealth tax. I calculated the taxes delta at some point with Zoug and the difference was also well above 10k for me. But I speak good French and kaum German… in terms of integration I would have a hard time leaving the region.

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